This framework document has been drawn up by [the department] in consultation with [the named ALB]. This document sets out the broad framework within which the [named body] will operate. The document does not convey any legal powers or responsibilities. It is signed and dated by [the department] and [the ALB]. Copies of the document and any subsequent
amendments have been placed in the Libraries of both Houses of Parliament and made available to members of the public on the ALB website.
Purpose of the [named ALB]
1.1 Under the [Name] Act, the [name of ALB] has been set up in order to support the strategic aims and business plan of the [sponsor] department(s). Its main aim is to […].
1.2 Its statutory duties are to:
• [short summary of overarching statutory duties]
1.3 The [ALB’s] strategic aims are to:
• [explain big picture aims] Aim 1
• Aim 2
1.4 Its mission statement (if any) is:
Governance and accountability
2 [A LB’s] legal origins of pow ers and duties
2.1 The [ALB’s] powers and duties stem from sections [?] and [Schedule?] of the [establishing legislation, include both primary and secondary legislation, as necessary].
3 O verall aim s
3.1 The Secretary of State/responsible Minister(s) has agreed that, subject to 1.3, the aims of [the ALB] should be as follows:
i) ii) iii)
4 M inisterial responsibility
4.1 The [name or office of the responsible and successor minister] will account for business in Parliament.
5 Sponsor departm ent’s accounting officer’s specific accountabilities and responsibilities as Principal A ccounting O fficer (PA O )
5.1 The Principal Accounting Officer (PAO) of [sponsor department] has designated the chief executive as [the ALB’s] accounting officer. (The respective responsibilities of the PAO and accounting officers for ALBs are set out in Chapter 3 of Managing Public Money which is sent separately to the accounting officer on appointment.)
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5.2 The PAO is accountable to parliament for the issue of any grant-in-aid to [the ALB]. The PAO is also responsible for advising the responsible minister:
• on an appropriate framework of objectives and targets for [the ALB] in the light of the department’s wider strategic aims and priorities;
• on an appropriate budget for the ALB in the light of the sponsor department’s overall public expenditure priorities; and
• how well the ALB is achieving its strategic objectives and whether it is delivering value for money.
5.3 The PAO is also responsible for ensuring arrangements are in place in order to:
• monitor the ALB’s activities;
• address significant problems in the ALB, making such interventions as are judged necessary;
• periodically carry out an assessment of the risks both to the department and the ALB’s objectives and activities;
• inform the ALB of relevant government policy in a timely manner; and
• bring concerns about the activities of the ALB to the full (ALB) board ,and, as appropriate to the departmental board requiring explanations and assurances that appropriate action has been taken.
5.4 [Named team] in the department is the primary contact for the ALB. They are the main source of advice to the responsible minister on the discharge of his or her responsibilities in respect of the ALB. They also support the PAO on his or her responsibilities toward the ALB.
6 Resp onsib ilities of the A LB’s chief executive as accounting officer General
6.1 The chief executive as accounting officer is personally responsible for safeguarding the public funds for which he or she has charge; for ensuring propriety, regularity, value for money and feasibility in the handling of those public funds; and for the day-to-day operations and management of the [named ALB]. In addition, he or she should ensure that the [named ALB] as a whole is run on the basis of the standards, in terms of governance, decision-making and financial management that are set out in Box 3.1 of Managing Public Money.
Responsibilities for accounting to parliament 6.2 The accountabilities include:
• signing the accounts and ensuring that proper records are kept relating to the accounts and that the accounts are properly prepared and presented in accordance with any directions issued by the Secretary of State;
• preparing and signing a Governance Statement covering corporate governance, risk management and oversight of any local responsibilities, for inclusion in the annual report and accounts;
• ensuring that effective procedures for handling complaints about the ALB are established and made widely known within the ALB;
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Managing Public Money
• acting in accordance with the terms of this document, Managing Public Money and other instructions and guidance issued from time to time by the Department, the Treasury and the Cabinet Office;
• giving evidence, normally with the PAO, when summoned before the PAC on the ALB’s stewardship of public funds.
Responsibilities to the [named sponsor department]
6.3 Particular responsibilities to [named sponsor department] include:
• establishing, in agreement with the department, the [named ALB’s] corporate and business plans in the light of the department’s wider strategic aims and agreed priorities;
• informing the department of progress in helping to achieve the department’s policy objectives and in demonstrating how resources are being used to achieve those objectives; and
• ensuring that timely forecasts and monitoring information on performance and finance are provided to the department; that the department is notified promptly if over or under spends are likely and that corrective action is taken; and that any significant problems whether financial or otherwise, and whether detected by internal audit or by other means, are notified to the department in a timely fashion.
Responsibilities to the board
6.4 The chief executive is responsible for:
• advising the board on the discharge of the [ALB Board’s] responsibilities as set out in this document, in the founding legislation and in any other relevant instructions and guidance that may be issued from time to time;
• advising the board on the [named ALB’s] performance compared with its aim[s] and objectives;
• ensuring that financial considerations are taken fully into account by the Board at all stages in reaching and executing its decisions, and that financial appraisal techniques are followed;
• taking action as set out in paragraph 3.8.6 of Managing Public Money if the board, or its chairman, is contemplating a course of action involving a transaction which the chief executive considers would infringe the requirements of propriety or regularity or does not represent prudent or economical administration, efficiency or effectiveness, is of questionable feasibility, or is unethical.
The [nam ed A LB’s] Board
7.1 The board should ensure that effective arrangements are in place to provide assurance on risk management, governance and internal control. The board must [set up an Audit Committee chaired by an independent non-executive member to provide independent
advice/ensure that the department’s Audit Committee provides assurance on risk]. The board is expected to assure itself of the effectiveness of the internal control and risk management systems.
7.2 The board is specifically responsible for:
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• establishing and taking forward the strategic aims and objectives of the ALB consistent with its overall strategic direction and within the policy and resources framework determined by the Secretary of State;
• ensuring that the responsible minister is kept informed of any changes which are likely to impact on the strategic direction of the [named ALB Board] or on the attainability of its targets, and determining the steps needed to deal with such changes;
• ensuring that any statutory or administrative requirements for the use of public funds are complied with; that the board operates within the limits of its statutory authority and any delegated authority agreed with the sponsor department, and in accordance with any other conditions relating to the use of public funds; and that, in reaching decisions, the Board takes into account guidance issued by the sponsor department;
• ensuring that the board receives and reviews regular financial information concerning the management of the [named ALB]; is informed in a timely manner about any concerns about the activities of the [named ALB]; and provides positive assurance to the department that appropriate action has been taken on such concerns;
• demonstrating high standards of corporate governance at all times, including by using the independent audit committee to help the Board to address key financial and other risks;
• [unless the establishing legislation provides for other arrangements] appoint [with the responsible minister’s approval] a chief executive and, in consultation with the department, set performance objectives and remuneration terms linked to these objectives for the chief executive which give due weight to the proper management and use and utilization of public resources. [Set out the arrangements in legislation if different from this.]
The chairman’s personal responsibilities
7.3 The chairman is responsible to the named minister. Communications between the [named ALB’s] board and the responsible minister should normally be through the chairman.
He or she is responsible for ensuring that policies and actions support the responsible minister’s [and where relevant other ministers’] wider strategic policies and that its affairs are conducted with probity. Where appropriate, these policies and actions should be clearly communicated and disseminated throughout the ALB.
7.4 In addition, the Chairman has the following leadership responsibilities:
• formulating the board’s strategy;
• ensuring that the board, in reaching decisions, takes proper account of guidance provided by the responsible minister or the department;
• promoting the efficient and effective use of staff and other resources;
• delivering high standards of regularity and propriety; and
• representing the views of the board to the general public.
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7.5 The chairman also has an obligation to ensure that:
• the work of the board and its members are reviewed and are working effectively;
• the board has a balance of skills appropriate to directing the [named ALB’s]
business, as set out in the Government Code of Good Practice for Corporate Governance;
• board members are fully briefed on terms of appointment, duties, rights and responsibilities;
• he or she, together with the other board members, receives appropriate training on financial management and reporting requirements and on any differences that may exist between private and public sector practice;
• the responsible minister is advised of [named ALB’s] needs when board vacancies arise;
• he or she assesses the performance of individual board members when being considered for re-appointment;
• there is a Board Operating Framework in place setting out the role and
responsibilities of the Board consistent with the Government Code of Good Practice for Corporate Governance
• there is a code of practice for board members in place, consistent with the Cabinet Office Code of Conduct for Board Members of Public Bodies.
Individual board members’ responsibilities 7.6 Individual board members should:
• comply at all times with the Code of Conduct for Board Members of Public Bodies and with the rules relating to the use of public funds and to conflicts of interest;
• not misuse information gained in the course of their public service for personal gain or for political profit, nor seek to use the opportunity of public service to promote their private interests or those of connected persons or organisations;
• comply with the board’s rules on the acceptance of gifts and hospitality, and of business appointments;
• act in good faith and in the best interests of the [named ALB].
8 A nnual rep ort and accounts
8.1 The [ALB Board] must publish an annual report of its activities together with its audited accounts after the end of each financial year. The [named ALB] shall provide the department its finalised (audited) accounts by [date] each year in order for the accounts to be consolidated within the [named department’s].
8.2 The annual report must:
• cover any corporate, subsidiary or joint ventures under its control;
• comply with the Treasury’s Financial Reporting Manual (FreM);
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• outline main activities and performance during the previous financial year and set out in summary form forward plans.
8.3 Information on performance against key financial targets is within the scope of the audit and should be included in the notes to the accounts. The report and accounts shall be laid in parliament and made available on the [named ALB’s] website, in accordance with the guidance in the FReM. A draft of the report should be submitted to the department [two weeks] before the proposed publication date. The accounts should be prepared in accordance with the relevant statutes and specific accounts direction issued by the department as well as the FReM.
9 Internal audit 9.1 [Named ALB] shall:
• [establish and maintain arrangements for internal audit in accordance with the Treasury’s Public Sector Internal Audit Standards (PSIAS)
(https://www.gov.uk/government/publications/public-sector-internal-audit-standards )/ ensure that the sponsor department’s internal audit team have complete access to all relevant records] [delete as appropriate]
• [in the event that the body has its own internal audit service] ensure the sponsor department is satisfied with the competence and qualifications of the Head of Internal Audit and the requirements for approving appointments in accordance with PSIAS;
• [set up an audit committee of its board in accordance with the Code of Good Practice for Corporate Governance and the Audit and Risk Assurance Committee Handbook, or be represented on the [named] sponsor department’s Audit Committee];
• forward the audit strategy, periodic audit plans and annual audit report, including the [named ALB] Head of Internal Audit opinion on risk management, control and governance as soon as possible to the sponsor department; and
• keep records of, and prepare and forward to the department an annual report on fraud and theft suffered by the [named ALB] and notify the sponsor department of any unusual or major incidents as soon as possible.
9.2 The internal audit service has a right of access to all documents, including where the service is contracted out.
10 External audit
10.1 [The Comptroller & Auditor General (C&AG) audits the [named ALB’s] annual accounts and lays them before parliament, together with his report/ The C&AG passes the audited accounts to the Secretary of State who will lay the accounts together with the C&AG’s report before parliament.] [Delete as applicable.]
In the event that the [named ALB] has set up and controls subsidiary companies, the [named ALB] will [in the light of the provisions in the Companies Act 2006] ensure that the C&AG is appointed auditor of those company subsidiaries that it controls and/or whose accounts are consolidated within its own accounts. The [ALB] shall discuss with the sponsor department the procedures for appointing the C&AG as auditor of the companies.]
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10.2 The C&AG:
• will consult the department and the ALB on whom – the NAO or a commercial auditor – shall undertake the audit(s) on his behalf, though the final decision rests with the C&AG;
• has a statutory right of access to relevant documents, including by virtue of section 25(8) of the Government Resources and Accounts Act 2000, held by another party in receipt of payments or grants from the [ALB];
• will share with the sponsor department information identified during the audit process and the audit report (together with any other outputs) at the end of the audit, in particular on issues impacting on the Department's responsibilities in relation to financial systems within the [named ALB];
• will, where asked, provide departments and other relevant bodies with Regulatory Compliance Reports and other similar reports which departments may request at the commencement of the audit and which are compatible with the independent auditor's role.
10.3 The C&AG may carry out examinations into the economy, efficiency and effectiveness with which the ALB has used its resources in discharging its functions. For the purpose of these examinations the C&AG has statutory access to documents as provided for under section 8 of the National Audit Act 1983. In addition, the ALB shall provide, in conditions to grants and contracts, for the C&AG to exercise such access to documents held by grant recipients and contractors and sub-contractors as may be required for these examinations; and shall use its best endeavours to secure access for the C&AG to any other documents required by the C&AG which are held by other bodies.
Right of access
10.4 The department has the right of access to all ALB records and personnel for any purpose including, for example, sponsorship audits and operational investigations.
Management and financial responsibilities
11 M anaging Public M oney and other governm ent-w ide corporate guidance and instructions
11.1 Unless agreed by the department and, as necessary, HM Treasury, [Named ALB] shall follow the principles, rules, guidance and advice in Managing Public Money, referring any
difficulties or potential bids for exceptions to [named team] in [department] in the first instance.
A list of guidance and instructions with which the ALB should comply is in Appendix [?].
11.2 Once the budget has been approved by the sponsor department [and subject to any restrictions imposed by statute][the responsible minister’s instructions][this document], the ALB shall have authority to incur expenditure approved in the budget without further reference to the sponsor department, on the following conditions:
• the ALB shall comply with the delegations set out in Appendix 2. These delegations shall not be altered without the prior agreement of the sponsor department;
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• the ALB shall comply with Managing Public Money regarding novel, contentious or repercussive proposals;
• inclusion of any planned and approved expenditure in the budget shall not remove the need to seek formal departmental approval where any proposed expenditure is outside the delegated limits or is for new schemes not previously agreed;
• the ALB shall provide the sponsor department with such information about its operations, performance individual projects or other expenditure as the sponsor department may reasonably require.
12 Corporate governance
Board appointments - the chairman and board members
12.1 The ALB chairman and board members are appointed for a period of [three] years by the responsible minister. Such appointments will comply with the Commissioner for Public
Appointments Code of Practice for Ministerial Appointments to Public Bodies.
Board appointments – the chief executive
12.2 [The chief executive is appointed by the responsible minister in consultation with [with the agreement of] the chairman./The chief executive is appointed by the ALB’s Board, consulting the responsible minister and PAO, as required.] [Delete as necessary]
Composition of the board
12.3 In line with the government’s Code of good Practice
(https://www.gov.uk/government/publications/corporate-governance-code-for-central-government-departments), the Board will consist of a chairman, together with [number] of executive members that have a balance of skills and experience appropriate to directing the ALB’s business. For [named ALB] there should be members who have experience of [add/delete as necessary or appropriate] its business, operational delivery, corporate services such as HR, IS, technology, property asset management, estate management, communications and
performance management. The board should include [number] of independent non-executive members to ensure that executive members are supported and constructively challenged in their role.
13 Risk m anagem ent
13.1 The [named ALB] shall ensure that the risks that it faces are dealt with in an appropriate manner, in accordance with relevant aspects of best practice in corporate governance, and develop a risk management strategy, in accordance with the Treasury guidance Management of Risk: Principles and Concepts (http://www.hm-treasury.gov.uk/orange_book.htm ). It should adopt and implement policies and practices to safeguard itself against fraud and theft, in line with the Treasury’s guidance on tackling fraud
(http://webarchive.nationalarchives.gov.uk/20130129110402/http://www.hm-treasury.gov.uk/d/managing_the_risk_fraud_guide_for_managers.pdf.pdf). It should also take all reasonable steps to appraise the financial standing of any firm or other body with which it intends to enter into a contract or to give grant or grant-in-aid.
14 Corporate and business plans
14.1 [By date] the [named ALB] shall submit annually to the sponsor department a draft of the corporate plan covering [three] years ahead. The draft should be submitted by [date]. The
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ALB shall agree with the department the issues to be addressed in the plan and the timetable for its preparation. The plan shall reflect the ALB’s statutory and/or other duties and, within those
ALB shall agree with the department the issues to be addressed in the plan and the timetable for its preparation. The plan shall reflect the ALB’s statutory and/or other duties and, within those